Haishu House 600398, stock bar: proposed to issue no more than 3 billion convertible bonds to strengthen internal power short-term attention to double eleven catalytic
Research institution: Everbright Securities
Event: The company announced that it plans to issue convertible bonds of not more than RMB 3 billion for a period of six years from the date of issuance, issued at face value, and invested in an industrial chain informationization upgrade project (intended to use raised funds of 620 million yuan) and logistics park construction projects. (It is planned to use 1.95 billion yuan of raised funds) and Aiju Rabbit R&D office building construction project (it is planned to use raised funds of 430 million yuan).
Capital investment: investing in 3 back-end support projects to strengthen internal strength
From the perspective of this investment project: 1) The total investment of the industrial chain informationization upgrading project is 709 million yuan. The company will promote the informationization of the store and build an integrated information platform for suppliers to create a “smart service system†and coverage covering 5,500 stores. The “Precision Marketing System†of 1,000 stores upgrades the Big Data Logistics Planning System and the Transportation Collaboration System.
2) The most expensive logistics park construction project has a total investment of 2.14 billion yuan. It is located in Haishu Garment Industrial City and Gushan Logistics Park. The company plans to build nine warehouses, one of which is used for e-commerce business (expected to support 5 billion yuan) Commercial sales scale), four for the women's love rabbit business (breaking the bottleneck of the love rabbit warehouse, is expected to support 2 billion yuan of love rabbit retail sales), four as the auxiliary warehouse of the South District of Haicang Home Logistics Park, Used for turnover, temporary storage, etc. of goods. The investment of this project is conducive to the rapid development of the company's business, especially to meet the needs of the rapid growth of e-commerce business and women's wear business, and to improve the company's logistics storage capacity and warehouse operation efficiency.
3) The total investment of Aiju Rabbit R&D office building project is 470 million yuan, which is mainly for the rapid expansion of the business scope of Aiju Rabbit. At the same time, it reserves the R&D personnel in advance for the company to extend the product line and brand line, expand children's wear, and light luxury brands.
The significance of this investment lies in: 1) This investment is mainly used for background efficiency improvement. Although it does not contribute significantly to the performance, it will be beneficial to the company's sales ability, warehousing logistics service service capability and operational efficiency, and focus on developing new growth point business e-commerce. And love rabbits, to provide efficient operating foundation and support for the company's multi-brand development strategy, thereby indirectly improving the company's performance. 2) It is conducive to optimizing the financing structure and strengthening the financial strength. At the end of September, the company's monetary capital of 6 billion reported that 2.4 billion time deposit certificates have been pledged to banks for issuing acceptance bills. After the financing is in place, the financial strength will be significantly enhanced, and the future multi-brand strategy advancement can still be expected.
Long-term expectation of leading multi-brand strategic advantages, short-term focus on double eleven catalytic
In the short-term, the company announced its strategic cooperation with Ali in September, and the Tmall double-pre-sale list will be listed in Haishu House (Men's 9th) and Yingshi (Mother and Baby 6th). Resources are tilted and we are looking forward to this year's double eleven catalysis and future e-commerce growth. For a long time, we continue to be optimistic about the success probability and scale advantage of the company as a leading multi-brand strategy. At present, new brands of self-owned and extended investment have brought new growth points in the expansion and expansion. Maintain EPS 0.74/0.82/0.90 for 17~19 years, corresponding to 13 times PE for 17 years, maintain “Buy†rating.
Risk warning: terminal sales continue to be sluggish, terminal sales rate is lower, and weather is abnormal.
Weixing shares 002003, stocks: employee stock ownership plan highlights long-term development confidence
Research institution: GF Securities
Investment Highlights : The company disclosed the first draft of the employee stock ownership plan. It plans to subscribe for 50 million yuan from no more than 330 employees (including 9 directors), and allocate 100 million yuan of priority trust funds to form a collective fund trust plan. The employee stock ownership plan will acquire the company's stock through the secondary market transaction within 6 months after the shareholders' meeting is approved. The lock-up period is 1 year and the duration is 3 years.
The employee stock ownership plan covers a wide range, fully demonstrating the company's long-term development confidence. The employee stock ownership plan is expected to cover 330 people, including 9 directors, supervisors and senior management personnel. The subscription amount is not expected to exceed 4.6 million yuan, accounting for 9.20% of the total. Other employees are core personnel, and the subscription amount is expected to not exceed 4540. Ten thousand yuan. In addition, Weixing Group, the controlling shareholder of the company, assumed the obligation to cover the position of the 150 million yuan collective fund trust plan, and provided a difference between the principal and the income of 100 million yuan. The employee stock ownership plan has a duration of 3 years and a lock-up period of 1 year. It binds the company's development performance to the depth of employee benefits, demonstrating long-term development confidence.
The company's revenue grew steadily, and its profitability remained stable in the context of rising raw material prices. In 2017Q1-Q3, the company's single-quarter revenue increased by 14.39%, 23.46%, and 13.28% year-on-year, and the overall growth remained steady and rapid. The company continued to improve product design and production capacity, optimize production efficiency, and based on this, sales and tackling, deepening demand for domestic customers, and actively expanding overseas markets. The sales volume of the company's products maintained a good growth momentum, and the price increase of raw materials promoted the price increase of products and jointly driven revenue growth. In the first three quarters of the year, the company's gross profit margin was 42.58%, a slight decrease of 0.59pct year-on-year. The overall profitability remained stable under the background of substantial price increase of raw materials, indicating the company's core competitiveness.
The 17-19 annual results are expected to be 0.58 yuan / share, 0.67 yuan / share, 0.76 yuan / share. Calculated according to the latest closing price, corresponding to the 17-year PE 19 times, taking into account the company's leading position, the performance has grown steadily, and the Bangladesh Industrial Park is expected to release production capacity next year, maintaining the “Cautious Overweight†rating.
Risk warning: raw material price increase risk; RMB exchange rate fluctuation risk; military performance lower than expected risk
Guangzhou-Shenzhen Railway: Cost Supervision and Auditing Entering the Final Stage of Drafting, Price Increase Is Expected to Open up Growth Space
Research institution: Zhongtai Securities
Event: On November 7, 2017, the National Development and Reform Commission called the news development conference to amend the 2006 “Government Formulation of Price Cost Supervision and Inspection Measuresâ€. Regarding the progress of the cost supervision and supervision of railway passenger transportation: "In the railway field, the railway company and its 18 subsidiaries are currently conducting supervision and examination of the pricing of ordinary passenger train transportation. Now the field audit has been completed and is currently underway. Do the summary and draft the final stage of the supervision report."
Passenger traffic declined slightly in the first three quarters, and cost pressures dragged down the company's performance. Affected by the high-speed railway diversion and the reduction of other long-distance vehicles entering the pipeline, the passenger volume of the Guangzhou-Shenzhen Railway in January-September 2017 decreased slightly by 1.5% year-on-year. The decline in the company's performance from January to September 2017 was mainly due to the year-on-year increase of 7.1% in operating costs. 2017H2 will have 10 trains and five repairs, taking into account the capitalization of some maintenance costs. We predict that the cost of the 17H2 trains will be 180 million yuan. The cost side will remain under pressure in the second half of 2017.
The passenger transportation price has not been adjusted for 22 years, and the cost supervision and evaluation has provided the basis for price increase. The last price adjustment of the railway passenger transport price was 1995, and it has not been adjusted for 22 years. In the same period, the domestic consumer price index CPI rose by about 55%, and the upward pressure on the cost made the demand for the price increase of the Pu passenger freight rate strong. On November 7, 2017, the National Development and Reform Commission issued a revision meeting on the “Measures for the Administration of Price and Cost Supervision and Examination of the Governmentâ€, which mentioned that the railway cost supervision and auditing entered the drafting of the final supervision and examination report, and the cost supervision and auditing is expected to be the follow-up price hearing and final price adjustment. Laying the foundation, we expect the price increase of railway passengers in 2018 is expected to land.
Judging from the vertical and horizontal dimensions, we expect the price increase of railway customers to be 50%. Historically, the base price of the national unified railway in 1955 was 1.755 points/person-kilometer. Up to now, it has experienced four price increases. Except for 1985, each price increase is above 50%. From the horizontal comparison, consider At present, the price of railway passengers is 20%~47% of the highway, and the speed of railway passenger transportation and highway is basically the same and the timeliness is better. From the above two dimensions, we expect the price increase of railway passengers to be 50%.
The only railway passenger transport platform on the Guangzhou-Shenzhen Railway, the flexibility of the price increase of Pu Ke is worth looking forward to. The Guangzhou-Shenzhen Railway is the only listed platform for A-share railway passenger transport. In 2016, passenger traffic and road network clearing and other services accounted for 83.7% of the revenue, and long-distance bus revenue accounted for 54.5% of the passenger transport business. With the acceleration of railway reform, we expect that the price increase of railway passengers in 2018 is expected to reach 50%. Assuming the price increase of 2018Q1, the price increase is 50%. We expect a net profit of 1.05 billion yuan in 2018, and the corresponding performance elasticity is 47% (18 years of company performance considers the price increase contribution).
BYD 002594, shares: an important step in the establishment of an open supply chain for auto parts with Faurecia
Research institution: Soochow Securities
Event: On November 1st, the company announced that it plans to invest RMB 228 million to establish a joint venture with Faurecia (China) Investment Co., Ltd. to establish Shenzhen Faurecia Auto Parts Co., Ltd., which accounts for 30% of the registered capital. Faurecia invests RMB in cash. 5.32 billion yuan, accounting for 70% of the registered capital. Shenzhen Faurecia Motors will develop, manufacture, assemble, sell and deliver automotive seat products and related parts that cover the entire vehicle, seat frame, seat foam, seat cover, and provide after-sales service. And technical consulting development services.
BYD has taken an important step in opening up the supply chain. BYD's automobile supply system is closed and perfect, but due to the long chain of automobile industry and numerous links, the production and supply of some of the company's own companies have not obtained the cost technology advantage. In recent years, the company's strategy has also turned to marketization. The first step is the marketization of parts procurement, and the second step is the marketization of power battery sales. Establishing a joint venture with Faurecia (China) to produce seats and other components is a representative step. As a symbol of the Citroen Group's auto parts manufacturers, Faurecia is also the world's top eight auto parts supplier in the car seat. The company's leading position in the four business areas of emission control technology systems, automotive interiors and exteriors, the company's cooperation with Faurecia, the procurement of parts such as open seats will help the company improve parts quality and reduce costs. In addition, regarding the capitalization of the battery business, the company is also actively seeking cooperation with other bus manufacturers. The company belongs to the first echelon of power battery, but because the power is not open to the outside world, it only relies on the consumption of its own models, the growth rate is limited, the market share begins to shrink, and it is difficult to enjoy the dividend of high-speed development of new energy vehicles. Therefore, the open power battery business is of great significance. .
The double-integration system has landed, which is good for new energy vehicles. The new energy points officially landed. In 2019 and 2020, the proportion of new energy points required is 10% and 12%. In the two years of combined assessment, the new energy points will be deducted for the new energy points. At the same time, last week, regarding the 2016 and 2017 fuel consumption points assessment management policy, the fuel consumption points were clearly determined two years ahead of schedule, and the strength increased, and new energy vehicle companies benefited. According to market research, it is estimated that a new energy energy price will be around 3,000 in the future, and the company's new energy passenger car output will be over 80,000. The company's new energy loyalty car points can reach more than 200,000 points, so if new energy points are traded, it can be significantly increased. Increase the company's performance.
The third quarter results are under pressure in the short term, optimistic about the fourth quarter volume and next year's growth. In the first three quarters of the company, the company achieved revenue of 73.93 billion yuan, a year-on-year increase of 1.56%, and a net profit of 2.79 billion yuan, a year-on-year decline of 23.8%. The performance of the first three quarters declined. Due to the decline in subsidies and declining profits, new energy buses have not yet been released, and various expenses have increased. We believe that the company's bus sales in the fourth quarter is expected to increase, and the growth rate will improve. The company expects net profit of homes in 2017 to be 4.04 billion to 4.29 billion, down 20%-15% year-on-year, which means that the company's net profit in the fourth quarter was 1.255-1 billion, an increase of 17%-40% from the third quarter.
Earnings forecast: We expect the company's net profit for 2017-2019 to be 41.58, 55.96, and 6.72 billion yuan respectively, corresponding to EPS of 1.52 yuan, 2.05, 2.46 yuan, and performance growth rate of -17.7%, 34.6%, 20.1%, corresponding to PE. They are 43 x, 32x, and 27x. Give the company 35 times PE in 2018, corresponding to the target price of 71.75 yuan, maintaining a "buy" rating.
Sanfu shares: photovoltaic silicon materials leading the development of optical fiber raw materials market
Research institution: Haitong Securities
Investment points : The company's main business is trichlorosilane and silicon tetrachloride, corresponding to polysilicon and fiber optic upstream; industry and company attention is low, the performance of double-increased sub-new shares, the market has a large expected difference.
The annual profit of more than 150 million, mainly the price increase, the performance in the first three quarters doubled, but the price only rose from 4000 to 4800. In September, the price quickly rose to 8000, and the fourth quarter performance exceeded expectations. Assuming the price is maintained at 8,000 yuan, the company's business profit will be more than 250 million (last year ton cost 3000, price 4200, ton gross profit 1200; this year silicon powder price increase, ton cost increased to 4200, price 8000, tons gross profit 3800, 80,000 The output per ton, 300 million gross profit, plus the total gross profit of potassium hydroxide is 400 million).
Next year, PV polysilicon imports will be replaced. Domestically, the demand for trichlorosilane will increase rapidly, but the supply end will not expand for three years, and the economy will remain the same.
Zhongtai Auto: Zhongtai Ford has a strong potential to open up new space
Research institution: Haitong Securities
Investment Highlights: Zotye will establish a joint venture with Ford (50:50, registered capital of 1.7 billion yuan), develop, produce and sell economical pure electric vehicles with new independent brands. Both parties will inject technology and build capacity in Zhejiang (100,000 yuan). Vehicle), the target accounts for more than 10% of the pure electric market.
Ford plans to launch 13 electric vehicles worldwide in the next five years. By 2025, 70% of the models sold in China will provide electric vehicle versions, and join forces with Zhongtai to jointly open up new market space and ease the pressure of NEV points.
Zotye is the leader of China's small pure electric passenger vehicles. It sold more than 22,000 pure electric vehicles in January-October, up +14% year-on-year. The most flexible performance of passenger car companies, the outstanding value of NEV points, combined with Ford, products, Brands will all break through.
Zhongtai completed the product structure upgrade and ushered in a high-speed development period. The electric vehicle continued to sell well, with a target price of 16.2 yuan and a “buy†rating.
Risk warning: new car sales were lower than expected, and new energy development progress was lower than expected.
Jinlitai 300225, stocks: domestic leading automotive coatings, M&A fund-driven industry transformation
Source: Tianfeng Securities
Investment points : The company is a leading domestic automotive coatings company, and the automotive coatings business is driving the steady growth of the main business.
The company's main products include cathodic electrophoretic coatings, automotive paints, industrial paints and ceramic coatings. We are optimistic about the downstream automotive industry, and the shortened changeover cycle has brought tremendous growth opportunities for the company's automotive cathode surge coatings and automotive paints. We judge that the company's main business can maintain steady growth every year.
Establish a merger fund, add to the layout of emerging areas, extend the pace or speed up
In May and August, the company established “Jiaxing Lairui Investment Partnership†(Lianrui Fund) and “Xiamen Shengxin Materials Industry Investment Fund Partnership (Limited Partnership)†with the counterparty. The total size of the M&A fund is 500 million yuan respectively. And 200 million yuan. Invested in new energy related materials and semiconductor equipment. With its technological advantages in the field of chemical materials, the company has invested in the integration of semiconductor materials + new materials industry, cut into emerging applications, and opened up new profit growth points.
Investing in Yi Tiji, layout OCA optical glue + fluorine chemical market, a key step in industrial investment
The company announced on August 22 that its “Emerging Industry M&A Fund†invested 260 million yuan in cash and purchased 20% of Yitai. The OCA optical adhesive + fluorine chemical market of Yi Tiji has a good extension of the company's main business and strong synergy with the company's main business. The company is expected to build a new growth point with the help of Yi Tiji cash technology:
1) The growth of OCA optical adhesive demand comes from the rise of OLED. OLED widely adopts OUT CELL touch-fit structure, which requires two layers of OCA optical adhesive, which is twice as large as INCELL solution, and the market is growing steadily. OCA optical adhesives are concentrated in the United States, Japan and South Korea. Yi Tiji and China National Aviation Corporation acquired the OCA business unit of Hitachi Chemical Co., Ltd., breaking the monopoly position of overseas companies in the OCA optical adhesive field. At the same time, combined with the OCA technology platform, Yi Tiji also actively invested in Emerging industries such as PI film, OLED polarizer, and lithium battery soft film;
2) In the field of fluorine chemical industry, in addition to the expansion of upstream main material, the Yiyi titanium fluoride business segment mainly has anti-fingerprint, anti-glare and waterproof fluorosilicone coating products, and downstream materials trade. Titanium has the advantage of the first market share of fluorosilicon materials.
Semiconductor is an important direction for the company's future investment (currently through the investment of industrial funds, Yi Tiji is also rich in semiconductor business reserves). We are optimistic about the company's 1) semiconductor packaging materials + 2) laser IC cutting market layout, the company is expected to play the industrial capital and the company's listed company platform integration advantages, open a new growth point.
Earnings forecast and investment suggestion: The company's main business maintained steady growth, and the extension expectation was strong. The company's 17-19 year net profit is expected to be 0.63, 0.88 and 110 million yuan, corresponding to EPS of 0.13, 0.19 and 0.23 yuan. The first coverage is given an “overweight†rating.
Four Chuang Electronics 600990, stocks: gross profit rate rebound performance into the fast rising channel
Research institution: Zhongtai Securities
Investment points : The gross profit margin rebounded sharply, and the performance entered a fast-rising channel. In the first three quarters, the company realized a total operating income of 2.258 billion yuan, an increase of 7.28%, a net profit of 70.685 million yuan, a 55.55% increase, a non-net profit of 100 million yuan, an increase of 535.35%, and a basic earnings per share of 0.4507 yuan / share . The company's net profit increased significantly, mainly because the gross profit margin of the products increased, the comprehensive gross profit margin reached 15.36%, an increase of nearly 2 percentage points (adjusted) compared with the same period of last year, and the financial expenses decreased by 37.37% compared with the same period of last year.
The military and civilian integration radar industry is developing well and has a leading edge. The company has been deeply involved in the field of radar for many years. Based on the strong R&D strength of the radar field in which the controlling shareholder China Electronics Branch 38 is located, the company has obvious leading advantages in meteorological radar and air traffic control radar. The company is one of the suppliers of weather radar of China Meteorological Administration, and it has a high market share. It is also the only radar manufacturer with S-band air traffic control primary radar license, which has strong market competitiveness. In May 2017, the company acquired Bowei Changan, added military warning radar equipment business, further expanded the radar product line, and the military and civilian integration radar industry layout became more mature, and the company's leading position in the radar field was consolidated. Bowei Changan's committed net profit for 2017 is 1005.44 million yuan, and we expect to significantly increase the company's full-year performance.
Adding code to the wisdom and energy fields to create a synergy pattern for the three industries. In addition to the main business of radar, the company has increased its distribution of wisdom and energy industry in recent years, expanded its business field, and formed three major industrial sectors: radar industry, smart industry and energy industry, and its profitability has been further enhanced. Smart Industry: Relying on the “Ping An Hefei†model, the company will continue to expand its market share in Ping An City projects, enhance the company's overall profitability, and promote the company's transformation from a single type of safe city construction to a comprehensive smart city construction.
Energy industry: Focusing on EPC general contracting business of centralized and distributed photovoltaic power plants and supplementing photovoltaic application products, based on Anhui, focusing on expanding the general contracting project of county photovoltaic power plants in Anhui Province, and radiating to the central and eastern regions, focusing on the development of Shandong and Jiangxi. In other areas, we are actively planning the construction of photovoltaic centralized power stations in Xinjiang and Ningxia.
The strength of the major shareholder is strong, and the company is expected to benefit from the mixed reform of military industry and the restructuring of the institute. The company's controlling shareholder, China Electronics Branch, is an important base for the development and production of military and civilian radars in China. It has comprehensive strength in electronic information technology and systems engineering. The company's actual controller, China Electronics Group, currently has an asset securitization rate of about 25%, which is still much room for improvement compared with other military industrial groups. In the first half of this year, the company completed the acquisition of 38 subsidiaries of Bowei Changan, which indicates that the asset integration of 38 controlling shareholders is progressing. With the military industry's mixed reforms and the restructuring of the institutes, the company will continue to benefit as the only listed platform of the Electronics Group.
Investment suggestion: The three major industries of the company are developing well, and the gross profit margin of the products is rising. We raise the profit forecast. It is estimated that the company will realize net profit of 247.27, 316.75 and 380.52 million yuan in 2017-2019, and the EPS will be 1.55, 1.99 and 2.39 yuan respectively. share. With reference to comparable company valuations, it was decided to give the company a 40x valuation in 2018, corresponding to a target price of RMB 79.6 per share. Maintain Buy rating.
Risk warning: business coordination is less than expected; market competition risk; policy risk
Kaisheng Technology: Performance turning point establishes profit trend upward
Research institution: GF Securities
Investment points: The company achieved revenue of 2.617 billion yuan in the first three quarters of 2017, a year-on-year increase of 31.60%, and the net profit attributable to the company was 90.428 million yuan, a year-on-year increase of 43.18%;
The performance turning point was established, and the profit trend was upward: the company's Q3 revenue was 1.05 billion, up 11% year-on-year (Q1 and Q2 revenue growth rates were 50% and 51% respectively). The growth rate was more obvious than the high base reason (the second half of last year) A number of electronic display projects were put into production, and Q3 revenue increased by 73% in the same period of the previous year; Q3's attributable net profit increased by 56% year-on-year, of which non-operating income was 23.73 million (the same period last year, 5.27 million), mainly due to the increase in government subsidies; It increased by 21.57% year-on-year, and continued to grow for three consecutive quarters since the negative growth in performance last year. The company's Q3 gross margin was 13%, down 1.5 percentage points year-on-year, mainly due to product structure changes, and the proportion of electronic display services such as modules with lower gross profit margins increased. During the period, the expense ratio decreased by 2.39 pct, and the administrative expense ratio decreased by 2.35 pct.
New materials: The zirconia faucet will benefit from the warming of the market, and the new products will go smoothly: due to the impact of environmental protection and limited production, the price of zirconia will increase significantly. Zhongheng, as the leader of fused zirconia, will benefit first, and the price will rise. The company is also active. Product upgrades, new electronic grade products such as barium titanate are progressing smoothly, and the barium titanate project has been put into production in August. With the completion of customer certification, it is expected to contribute to the performance in the next year.
Electronic display: mechanism optimization drives endogenous improvement, and the synergy effect of the whole industry chain is expected to appear: Guoxian was previously an excellent module private enterprise. After being acquired by the company, the endogenous improvement effect brought by the optimization of internal integration mechanism is gradually appearing. Thin business profit has been in the upward channel; ITO, mobile phone cover glass, TP business (touch screen glass, flexible coating) are still facing increasing market competition, with the country expanding to large size (notebook), small size (mobile phone) field And further expand new technologies such as full-screen display and naked-eye 3D, and the synergy of the whole industry chain is expected to be further revealed.
Investment suggestion: Maintain “Buy†rating: The company is backed by China National Building Material Group (CNC) and Design Institute (R&D), with new materials and electronic display dual main business. The medium-term development space is large; the demand for zirconia in new materials is picking up. As a leading industry leader, the company has significant benefits in cost control, and its profitability in zirconia business has increased. In terms of electronic display, Guoxian Technology has continued to maintain rapid growth, and the integration effect is gradually reflected. The EPS of 2017-2019 is expected to be 0.20 and 0.32 respectively. 0.49 yuan / share, according to the latest closing price, the corresponding PE is 44, 26, 17 times, maintaining a "buy" rating.
Risk warning: raw material prices have risen sharply and new product development has fallen short of expectations.
Poly Real Estate 600048, stocks: Poly Real Estate Sales Review continues to make great efforts to take the land
Research institution: Industrial Securities
Investment Highlights: Poly achieved a contracted area of ​​220,400 square meters in October, an increase of 54.66% over the same period of last year; the contracted amount reached 29.790 billion yuan, an increase of 84.49%. From January to October, the cumulative contracted area reached 17.016 million square meters, an increase of 29.95% over the same period of last year. The contracted amount reached 237.868 billion yuan, a year-on-year increase of 37.01%.
Comments:
Sales are beautiful. In October, Poly achieved a contracted area of ​​220,400 square meters, an increase of 54.66% over the same period of last year; the contracted amount reached 29.790 billion yuan, an increase of 84.49%. From January to October, the cumulative contracted area reached 17.016 million square meters, an increase of 29.95% over the same period of last year. The contracted amount reached 237.868 billion yuan, a year-on-year increase of 37.01%. As a leading real estate developer, the company's industry concentration has further improved. With efficient operational capabilities and forward-looking investment in land acquisition, leading real estate companies remain above the industry's overall growth rate.
The intensity of land acquisition continued to increase, with a focus on the core of the first and second lines. In October, the company added 2.518 million square meters of land storage and construction, and the ratio of land acquisition amount to sales amount in the month was 105%. From January to October, the ratio of accumulated land acquisition amount to sales amount was further increased to 74%, which was a significant increase of 17 percentage points compared with the overall level in 2016. The newly added 16 plots have a 37% share of land storage in first- and second-tier cities. The third-tier cities are all cities with good fundamentals and stocks in the Yangtze River Delta, such as Wuxi, Wenzhou and Huzhou. In addition to the traditional bidding and auction, the company took the land through cooperation and other methods, and the land cost control is better.
Investment suggestion: Poly Real Estate sales are beautiful, and the market share is further improved. The strength of land acquisition continued to increase, focusing on the core one or two lines. At present, the company's valuation is lower in mainstream real estate stocks, with good investment value and safety margin. We upgraded the company's 2017 and 2018 EPS to 1.21 yuan and 1.57 yuan, corresponding to 8.6 times and 6.6 times PE, maintaining a "buy" rating.
Risk warning: Monetary policy has been tightened sharply.
(Editor: Peng Shuang HX016)
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